Binance Plans Legal Action Against Checkout.com’s False Money Laundering Claims Amid Contract Closure

According to Forbes, renowned payment processor Checkout.com has officially ended its association with Binance, one of the world’s leading cryptocurrency exchanges. Citing concerns over money laundering and compliance, the payment gateway has taken this move, prioritizing its reputation and regulatory adherence.

Binance Denies Checkout’s Statements, Willing To Take Legal Action

Checkout.com, a prominent London-based credit card processing firm, has decided to end its association with cryptocurrency behemoth, Binance. The decision came to light after CEO Guillaume Pousaz sent two letters to Binance on August 9 and 11.

In these letters, Pousaz expressed concerns stemming from “regulatory actions and orders” as well as “inquiries from partners” related to Binance. A subsequent letter highlighted deeper reservations about Binance’s adherence to anti-money laundering regulations and compliance controls. The termination became effective on August 17, a fact later confirmed by Checkout.com’s spokesperson, Lewis Jones, to Forbes.

However, Binance refuted Checkout’s claims regarding the termination of their relationship. In a counterstatement, Binance expressed its disagreement with the reasons provided by Checkout for ending the contract and indicated that it was contemplating the possibility of taking legal measures.

Spokesperson Dewi Mustajab said, “We have come a long way to building an industry-leading compliance program and we hope to build more trust with regulators and partners.” He added that Checkout’s withdrawal would have “no impact on our services.”

Following Binance’s recent choice to discontinue Binance Connect, its platform for buying and selling cryptocurrencies, Checkout.com’s sudden separation from Binance has taken place. Binance Connect, which facilitated businesses in accepting cryptocurrency payments, had previously received support from Checkout.com.

Binance Charges Ahead Amid Regulatory Pressure

As Binance faces a series of investigations across multiple nations, Checkout has become the most recent payment provider to cut ties with it. Additionally, Checkout has confirmed transactions were inaccurate and inflated. Binance is currently facing fraud and money laundering charges from two U.S. agencies, resulting in leaving various jurisdictions. In June, European payments provider PaySafe also ceased its collaboration with Binance.

When Binance launched Checkout.com’s platform in early 2020, it skipped 3D-Secure for higher trading volume. Fraudulent transactions worth around $10 million followed, due to this omission, leading to Binance covering the losses and implementing 3D-Secure. Despite this, the relationship continued, making Binance Checkout.com’s biggest customer and accelerating its trading volumes.

However, in recent months, Binance secured multiple licenses from regulators. Last week, Binance secured its position as the first fully licensed cryptocurrency exchange in El Salvador, having been granted both the Bitcoin Services Provider license (BSP) and the Digital Assets Services Provider license (DASP) by local authorities.

Over time, the company’s remarkable growth has covered countries such as Italy, France, Sweden, Australia, the UAE, Japan, etc.